How Do You Know If You Need A Reverse Mortgage? - part 1

by Grant Shellhammer

With the growing popularity of Reverse Mortgages across the country, more and more seniors are asking themselves, "Do I need a Reverse Mortgage?" This question can be answered by using several different means. This article will discuss several of the most common questions in discovering the usefulness of the Reverse Mortgage for different individual situations as well as some suggestions to beginning the process.

1) "I don't have a mortgage! Why would I get a Reverse Mortgage?" This is one of the most common disputes that arise when discussing Reverse Mortgages. A financial goal for many seniors is the removal of all mortgage debt to the home, but this methodology is becoming outdated with the creativity of home equity programs that have recently come about, including the Reverse Mortgage. One of the fears of taking out a loan on a mortgage-free home is the threat of default and foreclosure. The Reverse Mortgage is one product that removes this threat. There are never any payments required for a Reverse Mortgage as long as you live in the home. It allows you to utilize the equity available in the home without the threat of losing the home, and without the added burden of monthly payments.

2) "I don't need anything." A Reverse Mortgage is commonly used to remove a current monthly mortgage payment, to help a senior out large medical or credit card debt, or to secure an investment or an insurance product. However, the phrase "I don't need anything" is a statement that is frequently used without looking at all the safeties and possibilities of having a Reverse Mortgage. A Reverse Mortgage can work as an extremely effective "safety net." It can establish a large, extremely liquid, and high interest earning account that can be counted on in the event of an emergency or an opportunity. Right now, Reverse Mortgage credit accounts, which function very similar to checking accounts, earn well over 6.7%. This extremely useful when a medical crisis occurs, or a timed financial opportunity presents itself, and the senior will not have to affect any of their savings, investments, or income.

3) "Why would I give my house away?" This is a common misconception that many seniors have when learning about Reverse Mortgages. First, a Reverse Mortgage Lender does not take your home or ownership of the home. There is no transfer of deed or title. The senior retains all rights of ownership they previously enjoyed and the only change is that the Reverse Mortgage becomes a lien on the property. The senior may sell the home and move at any time, and if the borrower should pass away, the home will be passed on to their heirs as designated in the will.

Read the end of
How Do You Know If You Need A Reverse Mortgage?

---

Related Reverse Mortgage Articles: Change In Texas Law May Make Reverse Mortgages More Popular Texas has always been reluctant to allow its citizens to borrow against their homes equity. A change in the law that makes it easier to take out a reverse mortgage may happen soon. Using A Reverse Mortgage Creatively A reverse mortgage can be a creative financial planning tool. Home Equity Loan - A Reverse Mortgage Could Provide A Comfortable Retirement! Reverse Mortgages, a form of home equity lending, have other uses besides funding nursing home expenses. Reverse Mortgage Payout Options How you take your reverse mortgage cash can be just as important as how much cash you can take. So it's important to pay attention to this often overlooked detail! Understanding And Selecting Reverse Mortgages What's a reverse mortgage? In a nutshell, it's this. In a regular mortgage, you make monthly payments to the lender.

Related Reverse Mortgage Questions: Other resources for Reverse Mortgage Reverse Mortgage? When the owner dies, who gets the house? read answers... Reverse Mortgage? Those of you that HAVE a reverse mortgage or have THOROUGHLY INVESTIGATED its ramifications, please tell us what your experience has been or the merits/shortcomings of them. read answers... Reverse Mortgage.?? My Grandfather (85) has his home paid for, but kind of falling into disrepair. He is thinking of a 'Reverse Mortgage'.. I have heard good and BAD about them.?? Any expert opinions?? read answers... Reverse Mortgage? My dad is 60 years old, he wants to retire in 2 years at age 62. He bought a 0k home couple of years ago, if he applies for Reverse Mortgage, does he have to make payments on his property? Thanks read answers... Reverse mortgage? I have found there is a TON of misunderstanding around reverse mortgages. 1. What do you think a reverse mortgage is? 2. How do you think it works? 3. Why do you think it is good/bad? You must answer all three to be considered for best answer. read answers...

Back from Reverse Mortgage Articles
to California Mortgage Articles Directory